Target and Abercrombie Rise, Deere and Staples Drop; CPI Flat

By Avi Salzman

This August isn’t nearly as exciting as last year (thank goodness), when the debt ceiling fight and subsequent Standard & Poor’s downgrade of the U.S. credit rating sent stocks reeling. The market is firmly in vacation mode, and volume has been way down from the yearly average.

That doesn’t mean there’s no news, just that traders are reading it on their Blackberries from the beach.

This morning, the U.S. government said the consumer price index was flat in July, below expectations for a 0.2% rise. The core CPI (excluding food and energy) rose 0.1%, also below expectations for a 0.2% rise.

To those looking for more help from the Fed, it’s another dollop of good news.

“With inflation and inflation expectations still very much in check, the Fed appears to have increasing flexibility to announce additional easing if the economy were to falter further,” wrote Jim Baird, chief investment strategist for Plante Moran Financial Advisors.

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Earnings reports, corporate strategies and analyst insights are all part of what moves stocks, and they’re all covered by the Stocks to Watch blog. We also look at macro issues, investor sentiments and hidden trends that are affecting the market. Stocks to Watch gives you the full picture of the U.S. stock markets, all day long.

The blog is written by Ben Levisohn, a former stock trader who has covered financial markets for the Wall Street Journal, Bloomberg and BusinessWeek.